Euro advances slightly

EUR/USD advances slightly above the round-level resistance of 1.0800 in Tuesday’s early American session. The major currency pair strengthens even though the United States (US) Producer Price Index (PPI) data for April remains stubborn. The US Bureau of Labor Statistics (BLS) shows that monthly headline and core PPI grew strongly by 0.5% from expectations of 0.3% and 0.2%, respectively. Annually, headline and core PPI grew in line with estimates of 2.2% and 2.4%, respectively. 

Hot PPI figures are expected to dent investors' confidence in the Federal Reserve (Fed) to start reducing interest rates from the September meeting. For more clarity, investors will focus on the US Consumer Price Index (CPI) for April, which will be published on Wednesday.   

After the US PPI release, Fed Chair Jerome Powell commented that the report is broadly mixed. When asked about the interest rate outlook, Powell ruled out fears of a rate hike but emphasized maintaining interest rates at their current levels for a longer period to bring inflation down.